Case Study: Contribution After Marketing

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|Contribution After Marketing |
|Assume that the sales forecast for brand TOJO is 160,000 units, and that you expect to sell 50% of these units through mass merchandisers, 25% via specialty |
|stores, and 25% through online stores. As the brand manager, you have specified a retail price of $300. The unit transfer cost is $109. You plan to spend $2.2 |
|million on media placement and advertising research, and another $1.8 million on the commercial team. |
|Based on the information provided calculate the anticipated “contribution after marketing” next period for brand TOJO. Show your work. 15 points. |
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| |
|160,000 x 300 = $48,000,000 Retail Sales |
|160,000 x 109 = $17,440,000 Unit Cost |
|48,000,000 – 17,440,000 = 30,560,000 Marketing Contribution |
|30,560,000 – 2,200,000 – 1,800,000 = $26,560,000 Contribution After Marketing |
|Market Analysis and Logic: 15 points. |
|The following table displays key information for three brands, each of which targets Hi Earners. The bottom row displays Hi Earners’ shopping habits and ideal |
|values for economy, performance, convenience. Please note that each brand was introduced to the market at the same time. Based on this information, explain |
|why brands SUPER and TITANIUM have less market share than brand MARVEL. Provide a well-reasoned and insightful answer. |
|Hi Earners Market Segment |
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| |
|Market |
|Share |
|Aware |
|% |
|Distribution Coverage |
|Retail |
|Price
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